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Carozza v. Bank of America

November 24, 2008


On appeal from Superior Court of New Jersey, Law Division, Special Civil Part, Essex County, No. DC-24437-06.

Per curiam.


Argued September 29, 2008

Before Judges Wefing, Parker and LeWinn.

Defendant Bank of America appeals from a trial court order denying its motion for counsel fees and costs. After reviewing the record in light of the contentions advanced on appeal, we affirm.

On April 24, 2006, the New York State Department of Taxation and Finance issued to defendant a Tax Compliance Levy in the amount of $52,379.47 against plaintiff. The levy specified four accounts plaintiff had maintained in defendant's branches located in New York State but by the time the levy was issued, plaintiff had closed those accounts and opened two accounts with defendant's West Orange branch. Upon receipt of the levy, defendant froze those two accounts, which held approximately $49,000 between them.

Plaintiff contended that a levy issued by New York State was ineffective with respect to an account maintained in New Jersey. By May 25, defendant had determined that plaintiff's position was correct, and it restored to plaintiff's account the funds it had previously frozen. In the interim, it had assessed plaintiff's accounts with various charges, primarily overdraft fees. Defendant declined to reverse those charges.

In August 2006, plaintiff, acting pro se, filed a complaint in the Special Civil Part, seeking reimbursement for the expenses he had incurred in connection with the bank honoring this out-of-state levy. In his complaint, plaintiff alleged three theories of recovery: breach of contract, breach of fiduciary duty, and tortious conduct. In October, counsel for defendant wrote to plaintiff, outlining defendant's position that there was no merit to the complaint and informing plaintiff that if he did not dismiss his complaint within twenty-eight days, defendant would seek counsel fees and costs at the conclusion of the litigation under N.J.S.A. 2A:15-59.1 and Rule 1:4-8. Plaintiff did not withdraw his complaint, and the matter continued.

In January 2007, defendant moved for summary judgment, contending that it had acted in accordance with the depositor's agreement that it asserted governed these accounts. When defendant was unable to produce the signature cards plaintiff had signed when he opened these accounts, the trial court denied defendant's motion.

The matter proceeded to trial, by which time defendant had located the signature cards. The matter was heard as a bench trial and took less than one day. Only two witnesses testified: plaintiff*fn1 and a representative of defendant. At the conclusion of the trial, the court entered judgment for defendant. Defendant then moved for an award of counsel fees and costs. It appeals from the trial court order denying its motion. The trial court appended to its order the following statement of reasons:

The court finds that def[endant] failed to establish that the lawsuit was filed for purposes of harassment. The court further finds, based on its review of the trial transcript, that p[lain]t[if]f was making a good faith argument for the modification of existing law or the establishment of new law.*fn2

We note first the standard governing our review of this matter. An award or denial of counsel fees generally rests within the sound discretion of the trial court, and our review is limited to a determination of whether the trial court here abused its discretion when it determined that fees should be denied. Shore Orthopaedic Group, LLC v. Equitable Life Assur. Soc'y, 397 N.J. Super. 614, 626 (App. Div.), certif. granted on other grounds, 195 N.J. 523 (2008); K.D. v. Bozarth, 313 N.J. Super. 561, 574-75 (App. Div.), certif. denied, 156 N.J. 425 (1998).

Rule 1:4-8 provides that attorney fees may be awarded by a court to a prevailing party against attorneys or litigants proceeding pro se for pursuing frivolous claims. The rule defines frivolous claims as claims presented for an improper purpose, "such as to harass or to cause unnecessary delay or needless increase in the cost of litigation," R. 1:4-8(a)(1), or claims that are not "warranted by existing law or by a non-frivolous argument for the extension, modification, or reversal of existing law or the establishment of new law[.]" R. 1:4-8(a)(2).

Claims for counsel fees against pro se litigants for pursuing frivolous litigation are governed by Rule 1:4-8 because such litigants are regarded as lawyers for purposes of the rule. Trocki Plastic Surgery Ctr. v. Bartkowski, 344 N.J. Super. 399, 405 (App. Div. 2001), certif. denied, 171 ...

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